In today's rapidly changing and highly competitive business world, it is vital for investors and industry enthusiasts to carefully assess companies. In this article, we will perform a comprehensive industry comparison, evaluating NVIDIA NVDA against its key competitors in the Semiconductors & Semiconductor Equipment industry. By analyzing important financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within the industry.
NVIDIA Background
Nvidia is a leading developer of graphics processing units. Traditionally, GPUs were used to enhance the experience on computing platforms, most notably in gaming applications on PCs. GPU use cases have since emerged as important semiconductors used in artificial intelligence. Nvidia not only offers AI GPUs, but also a software platform, Cuda, used for AI model development and training. Nvidia is also expanding its data center networking solutions, helping to tie GPUs together to handle complex workloads.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| NVIDIA Corp | 48.84 | 45.97 | 27.15 | 31.13% | $22.86 | $26.16 | 93.61% |
| Taiwan Semiconductor Manufacturing Co Ltd | 29.46 | 8.06 | 11.94 | 9.05% | $596.09 | $512.38 | 38.84% |
| Broadcom Inc | 159.96 | 14.29 | 19.12 | 6.49% | $7.29 | $9.0 | 51.2% |
| Advanced Micro Devices Inc | 103.85 | 3.34 | 7.90 | 1.36% | $1.55 | $3.42 | 17.57% |
| Qualcomm Inc | 19.21 | 7.22 | 4.98 | 11.46% | $3.21 | $5.78 | 18.69% |
| Texas Instruments Inc | 34.67 | 9.73 | 10.59 | 7.05% | $2.09 | $2.47 | -3.47% |
| ARM Holdings PLC | 244.02 | 25.80 | 44.36 | 1.83% | $0.11 | $0.81 | 4.71% |
| Analog Devices Inc | 64 | 2.96 | 11.10 | 1.36% | $1.12 | $1.42 | -10.06% |
| Micron Technology Inc | 25.50 | 2.12 | 3.44 | 4.07% | $4.3 | $3.35 | 84.28% |
| Monolithic Power Systems Inc | 69.76 | 12.83 | 14.84 | 6.35% | $0.17 | $0.34 | 30.59% |
| Microchip Technology Inc | 38.91 | 4.79 | 5.55 | 1.24% | $0.34 | $0.67 | -48.37% |
| ON Semiconductor Corp | 13.34 | 2.67 | 3.17 | 4.75% | $0.63 | $0.8 | -19.21% |
| STMicroelectronics NV | 10.18 | 1.26 | 1.64 | 1.98% | $0.74 | $1.23 | -26.63% |
| ASE Technology Holding Co Ltd | 19.84 | 2.27 | 1.19 | 3.16% | $28.59 | $26.43 | 3.85% |
| First Solar Inc | 14.30 | 2.34 | 4.63 | 4.22% | $0.45 | $0.45 | 10.81% |
| Skyworks Solutions Inc | 24.43 | 2.29 | 3.49 | 0.95% | $0.18 | $0.43 | -15.9% |
| United Microelectronics Corp | 9.20 | 1.29 | 2.06 | 4.0% | $29.73 | $20.43 | 5.99% |
| MACOM Technology Solutions Holdings Inc | 122.02 | 8.38 | 12.80 | 2.67% | $0.05 | $0.11 | 33.47% |
| Qorvo Inc | 307.25 | 2.41 | 2.18 | 1.22% | $0.1 | $0.45 | -12.44% |
| Lattice Semiconductor Corp | 55.25 | 11.05 | 13.88 | 1.03% | $0.03 | $0.09 | -33.87% |
| Universal Display Corp | 29.36 | 4.37 | 10.82 | 4.29% | $0.08 | $0.13 | 14.57% |
| Average | 69.73 | 6.47 | 9.48 | 3.93% | $33.84 | $29.51 | 7.23% |
Upon a comprehensive analysis of NVIDIA, the following trends can be discerned:
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A Price to Earnings ratio of 48.84 significantly below the industry average by 0.7x suggests undervaluation. This can make the stock appealing for those seeking growth.
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With a Price to Book ratio of 45.97, which is 7.11x the industry average, NVIDIA might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
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The Price to Sales ratio of 27.15, which is 2.86x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
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With a Return on Equity (ROE) of 31.13% that is 27.2% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
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The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $22.86 Billion is 0.68x below the industry average, suggesting potential lower profitability or financial challenges.
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Compared to its industry, the company has lower gross profit of $26.16 Billion, which indicates 0.89x below the industry average, potentially indicating lower revenue after accounting for production costs.
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The company is experiencing remarkable revenue growth, with a rate of 93.61%, outperforming the industry average of 7.23%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio helps evaluate the capital structure and financial leverage of a company.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
By analyzing NVIDIA in relation to its top 4 peers based on the Debt-to-Equity ratio, the following insights can be derived:
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NVIDIA demonstrates a stronger financial position compared to its top 4 peers in the sector.
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With a lower debt-to-equity ratio of 0.16, the company relies less on debt financing and maintains a healthier balance between debt and equity, which can be viewed positively by investors.
Key Takeaways
For NVIDIA in the Semiconductors & Semiconductor Equipment industry, the PE, PB, and PS ratios indicate that the stock is relatively undervalued compared to its peers. However, the high ROE, low EBITDA, low gross profit, and high revenue growth suggest that the company is performing well and has strong growth potential within the industry sector.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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